In NSW, providing false or misleading information to a Compulsory Third Party (CTP) insurer can have a significant impact on the viability of a compensation claim. In some circumstances an insurer may even allege that an injured person’s failure to provide truthful information amounts to fraud, an allegation which can have both civil and criminal ramifications. In this edition of the Advantage Legal ‘Compensation Insider’ series, we explore the importance of accuracy, honesty and disclosure in NSW CTP Claims and why it is crucial to be as accurate and honest as possible in your dealings with the CTP insurer.
THE OVERVIEW
Ensuring a smooth and fair process for a CTP claim begins with a fundamental principle: accuracy and honesty. Providing timely and truthful information to a CTP insurer is the cornerstone of expediting the claims process, promoting fairness, and facilitating a swift claim resolution. Whether intentional or not, claim inaccuracies impact a compensation outcome and an injured person’s recovery prospects. CTP insurers rely heavily on the information provided to them to evaluate and manage claims, highlighting the importance of getting it right from the start. If errors or omissions are identified at a later date, correcting them isn’t just about factual accuracy, but also about nurturing trust with the insurer and minimising potential disputes in the future.
THE DETAIL
The NSW CTP scheme acts as a safety net for injured motorists and road users by providing prompt access to medical and treatment expenses, rehabilitation services and weekly payments on a no-fault basis. It also provides access to lump sum compensation for people who have sustained injuries that do not fall within the definition of the statutory term ‘threshold injury’ and who are not at-fault for an accident. For the motor accident scheme to work as intended, CTP insurers are reliant on information provided to them in order to facilitate a just, quick and expeditious resolution of CTP claims. Where the information provided by an injured person is inaccurate, whether innocently or deliberately, the inaccurate information has a negative impact on the way the claim is managed and, in many circumstances, how an injured person recovers from their injuries.
Accurate Information is Crucial From The Time A Claim Is Lodged
To commence a CTP claim an injured person needs to provide a CTP insurer with a number of documents including an Application for Personal Injury Benefits, a Certificate of Fitness and supporting documentation to justify any losses sustained. These documents form the basis of the claim for compensation and allow an insurer to determine how they need to rehabilitate and compensate an injured person, particularly at the initial part of the claim. Part of the claim lodgement process involves signing a declaration that the information provided is true and correct. In circumstances where a person has knowingly provided false information, they may be guilty of an offence under the Crimes Act 1900, an offence which carries a penalty of up to 2 years imprisonment or alternatively a fine up to $22,000. It is therefore essential that the injured person provides accurate information at the time of claim lodgement and updates the insurer as soon as new or more accurate information comes to light. This may include information relating to loss of earnings, circumstances of the accident, injuries and disabilities etc.
An Ongoing Obligation To Act Honestly
Beyond the initial lodgement of a CTP claim, both a CTP insurer and an injured person have a legislative duty to act honestly and to not mislead under Section 6.3 of the Motor Accident Injuries Act 2017. This is an ongoing duty that extends for the life of a claim and ensures that a CTP insurer acts in a manner consistent with its legislative obligations towards the injured person. It also places an obligation on an injured person to only pursue a claim for injuries, disabilities and losses legitimately incurred as a result of the motor accident in question.
How Insurers Use Information Provided by Injured People
Upon receipt of a claim a CTP insurer will typically undertake a due diligence process to confirm a valid claim is being made. This may include undertaking investigations to verify the identity of the injured person, to confirm that the accident occurred in the manner alleged or to validate that the information provided by the injured person is accurate. The due diligence process can take many forms, but typically involves cross referencing the information provided by the injured person with information that can be obtained from other sources such as internal and external databases, the NSW Police report of the accident, independent liability investigations, statements from witnesses and its own insured driver’s version of events.
Beyond the insurer’s initial due diligence, the information provided by an injured person will also be used to approve treatment, rehabilitation, home care and weekly income payments. If a claim for common law damages compensation is made, the information provided will be used to determine an injured person’s right to lump sum compensation. If information provided by an injured person is incorrect, false or misleading the insurer may deny a specific element of a claim, deny a claim outright, allege that a false or misleading statement exists or refer an injured person to the NSW Police Force for fraud investigation and prosecution. It is therefore critical that an injured person provides accurate information to ensure that an insurer forms an accurate view of the injured person and the claim so that it may proceed in a correct, timely and efficient manner.
Can Inaccurate Information Be Rectified?
Whilst it is strongly recommended that every effort be made to provide the insurer with accurate information in the first instance, accidents and errors do occur. The key to maintaining trust with the insurer and credibility in the eyes of a Decision Maker or Judge is to ensure that errors or omissions are rectified at the first available opportunity, providing the insurer with sufficient time to reconsider its position and if necessary, conduct further investigations and medical examinations.
For example, an injured person may inadvertently fail to inform the insurer that they had a prior injury or compensation claim due to the fact that it happened a long time ago. This prior accident may subsequently come to light in clinical notes or through the insurer’s own investigations. Whilst an insurer may suspect that the omission to disclose the earlier accident is deliberate, in our experience, injured people simply forget things with the passage of time. The injured person can rectify this omission by cooperating with the insurer and detailing as much information as possible about the prior accident and/or providing access to other extrinsic information that will allow the prior injury or claim to be fully understood. It should be noted however that in circumstances where a prior accident results in a substantial injury or amount of compensation being paid, it is unlikely that an insurer would accept that an injured person simply ‘forgot’ about it. Ultimately this means that a more detailed explanation is needed to justify the lack of disclosure or the injured person’s credibility as a witness will be called into question.
The Benefits of Accurate Disclosure in CTP Claims
The significance of providing accurate information to a CTP insurer when pursuing a CTP claim cannot be overstated. Some of the benefits of accurate and timely disclosure of information to a CTP insurer include:
Prompt access to treatment, care and weekly benefits.
More accurate and substantial rehabilitation can be provided in circumstances where a complete and accurate injury history is known and factored in.
Trust is established from an early stage with the insurer and rehabilitation providers which can facilitate a desire to be more helpful.
Compensation processes are streamlined and disputes minimised allowing for prompt, quick and just compensation payments to be made.
Opportunities for adverse findings of fact or credit are significantly reduced.
THE KEY POINTS TO REMEMBER
Providing accurate information to an insurer is critical to the success of a CTP compensation claim. Deliberately providing false information can result in imprisonment or fines.
Insurers rely on the information provided by injured people as the basis of a claim for compensation. The provision of inaccurate information may result in a claim being significantly delayed, denied in part or whole, treatment or weekly payments being refused and/or serious criminal allegations being made.
If incorrect information is provided to an insurer at any time, promptly rectifying the inaccuracy will go a long way to establishing and maintaining trust with the insurer and proving that the injured person is a ‘person of credit’ and should be believed.
NEED ASSISTANCE?
Advantage Legal’s Principal Solicitors are Accredited Specialists in NSW personal injury law. We offer no-win, no-fee billing and guide you through every step of the compensation claim process including working with treatment and rehabilitation providers to fully understand how your injuries are impacting you. We also pay your upfront claim investigation fees such as specialist medical reports to ensure there is no financial burden on you throughout the progression of your claim, and only seek reimbursement at the successful conclusion of your claim.
This article is for education purposes only and should not be relied upon as legal advice. Readers should be aware that NSW compensation law changes regularly and that the accuracy of information contained within this article is current as of 1 October 2023. Any person relying on the information contained in this article does so at their own risk.